Partnership to Revitalize Air Cargo

By Patrick Burnson, Executive Editor
November 21, 2013 - SCMR Editorial

The International Air Transport Association (IATA) recently called on all participants in the air cargo value chain to work together towards the common goals of improved quality, increased efficiency through e-AWB and e-freight and more effective security. Combined, these measures will improve air cargo’s competitiveness in the face of stagnant demand growth and unfavorable market developments.

Air cargo is suffering from a prolonged slump that has seen falls in yields, revenues and market share. Since 2010 world trade has grown by 12% whereas air cargo demand growth has been basically flat with only a 2% increase. A divergent trend in passenger demand, with growth continuing in the historical 5-6% range, has complicated the situation. As airlines grow fleet capacity to meet rising passenger demand, capacity has been introduced into weak cargo markets, putting considerable downward pressure on yields. Cargo revenues in 2013 are expected to be $59 billion, some $8 billion below the 2011 peak.

“No business or business model survives over the long term without evolving. Air cargo is being buffeted by forces for change. These include changes in the economics of just-in-time manufacturing, longer delivery lead times, innovation by alternative modes of transport, and environmental pressures. In the face of these challenges, air cargo needs to work together as an industry to improve competitiveness and protect its value proposition,” said Tony Tyler, IATA’s Director General and CEO, speaking to the Air Freight Institute at the World Congress of the International Federation of Freight Forwarders Associations (FIATA), in Singapore.

“By working together we have made global air cargo safe, secure and reliable. So reliable, that it is often taken for granted. It is the unsung hero of the global economy—underpinning global supply chains and delivering products to markets. But if we are to return the business to growth, the industry must collectively embrace an agenda for enhanced quality, efficiency and security,” said Tyler.



About the Author

image
Patrick Burnson
Executive Editor
Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review magazines and web sites. Patrick is a widely-published writer and editor who has spent most of his career covering international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. You can reach him directly at .(JavaScript must be enabled to view this email address).

Subscribe to Logistics Management magazine

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your
entire logistics operation.
Start your FREE subscription today!

Recent Entries

The PMI, the ISM’s index to measure growth, fell 1.4 percent to 51.5 (a PMI of 50 or greater represents growth), declining for the fifth straight month since reaching 57.9 in October 2014. And it is 4 percent below the 12-month average of 55.5. The March PMI is at its lowest level since May 2013’s 50.1.

How the food giants integrate supply chain operations is one of the most interesting components of the recently-announced merger between H.J. Heinz Co. and The Kraft Foods Group.

The new online offering is entitled “Vessels at a Glance” and is comprised of a daily update that shows all vessels at berth and anchor within POLB, as well as the Port of Los Angeles (POLA). It also includes information relating to vessel arrival and departure dates and length of stay in Long Beach, too, along with weekly updated charts that show the number of vessels at anchor at POLB and POLA that POLB officials said illustrate trends occurring over the last six months.

The Department of Transportation’s Bureau of Transportation Statistics (BTS) reported this week that U.S. trade with its North America Free Trade Agreement partners Canada and Mexico in January dropped 1.2 percent to $89.3 billion.

Download our new white paper, "The ABCs of HST: Understanding the Harmonized System of Tariffs," for insights and explanations of the complex cross-border classification codes.

About the Author

Patrick Burnson, Executive Editor
Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review. Patrick covers international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. Contact Patrick Burnson

Comments

Post a comment
Commenting is not available in this channel entry.